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Offshore Trusts Report: Jersey

Jersey Trusts Amendment Act 2006

In early 2005, the government published a consultation paper proposing significant amendments and enhancements to the Island’s Trusts Law. Five main amendments were proposed.

The paper noted some criticism of the existing anti-forced heirship provisions contained in Article 8A of the Trusts Law and proposed either amending the existing article or deleting it entirely and replacing it with a new article. It is also proposed that Article 8A(2) of the Trusts Law should apply to all individuals, not just persons domiciled outside Jersey.

The paper proposed that a new article should be added to the Trusts Law to confirm that the reservation, or grant to another person, by a settlor of any powers from a defined list should not invalidate the trust, and also to allow the statutory duty of care imposed on trustees to be written out by the trust instrument.

The paper also proposed that Article 25 of the Trusts Law should provide that the requirement to disclose trust documents and accounts to beneficiaries shall be “subject to the terms of the trust”, though a beneficiary will retain a right to seek from the Royal Court (i) a declaration that in the particular circumstances the trustees are not sufficiently accountable to the beneficiaries, and (ii) an order extending or restricting the rights of beneficiaries to information.

The fourth proposals was to amend Article 28 of the Trusts Law to remove some perceived ambiguities in respect of the liabilities of trustees in dealing with third parties.

Lastly, the paper proposed that retiring and former trustees should have a non-possessory lien over the trust property. This would give former trustees a right, if they find that they have a liability relating to the trust, to follow trust assets into the hands of successor trustees and even beneficiaries.

This consultation laid the groundwork for the The Trusts (Jersey) Amendment No. 4 Law 2006, which became law on October 27 that year. The amendments were designed to maintain and enhance Jersey’s position as one of the world’s leading international trust jurisdictions by ensuring that its trusts legislation responds to developments in other jurisdictions and remains internationally competitive.

Among the amendments was the introduction of settlor-reserved powers, which will provide greater statutory certainty regarding the level of control and influence a settlor may exercise, in appropriate circumstances, over the ongoing administration of assets placed into trust. The powers that may be reserved by the settlor will include the power to appoint and remove trustees, to amend or revoke the terms of the trust and to appoint or remove an investment manager or investment adviser

The amendments also permit a trustee to delegate any of his or her trusts or powers if permitted by the terms of the trust.

Other amendments include conflict of law provisions which will mean that the validity of a trust governed by Jersey law is not be affected by any rights conferred on anyone under a foreign law, and a proposal that removes the existing automatic ‘personal guarantor’ provisions for directors of corporate trustees, thereby making it more attractive to establish private trust companies in Jersey.

Beverley Le Cuirot, Director of Marketing of Jersey Finance, observed at the time that:

“The changes brought in under the Amendment No. 4 Law are the most significant since the Trusts (Jersey) Law came into force in 1984. The purpose is to clarify and enhance the existing Law, and to bring greater certainty to key questions concerning the validity of Jersey Trusts and the powers that may be retained by the settlor of a Jersey Trust.

“In addition, the Amendment will remove a number of provisions in the principal Law which were perceived by some practitioners as limiting the attractiveness of Jersey as a centre for very high net worth private family trust business.

In July 2008, Jersey's Economic Development Department issued on Thursday a consultation paper reviewing the Island's trusts law with a view to ensurong that they remainsup to date, reflects recent international developments, and continues to provide a framework that confirms Jersey’s position as a market leader.

Senator Philip Ozouf, the Minister for Economic Development, commented:

“The Trusts Law has been to a great extent the engine for the growth of our financial services industry in the last 20 years. Our Law was the first in the market place and others have followed our lead. Subsequently, trusts laws in other places have evolved and in some cases moved ahead of our own product. This consultation is designed to see how we should develop our Trusts Law so as to hone our competitiveness.”

The consultation paper covered ten discrete areas of possible reform with a view to developing Jersey’s trusts legislation in a way that ensures the maximum overall benefit for the Island. Responses were invited by 19 September 2008.

   

The Report

Offshore Trusts Guide: Introduction

The History of Offshore Trusts
Development of Professional Competence in the Jurisdictions
What Future for the Trust?
The New Age of Transparency
The Swiss Association of Trust Companies
The Society of Trusts and Estates Practitioners

Offshore Trusts Guide: Jurisdictions

Bahamas

Bahamas: Legal Framework and Formation Rules and Fees
Bahamas: 2006 Private Trust Companies Legislation

Barbados

Barbados: Legal Framework and Formation Rules and Fees
Barbados: Supervisory and Licensing Regime and Fees

Bermuda

Bermuda: Legal Framework and Formation Rules and Fees
Bermuda: Supervisory and Licensing Regime and Fees

British Virgin Islands

British Virgin Islands: Legal Framework and Formation Rules and Fees
British Virgin Islands: Special Trusts Act 2003
British Virgin Islands: The Trustee Act 2003
British Virgin Islands: :Supervisory and Licensing Regime and Fees
British Virgin Islands: New Laws on Private Trust Companies
British Virgin Islands: New Private Trust Company Regulations

Cayman Islands

Cayman Islands: Legal Framework and Formation Rules and Fees
Cayman Islands: Supervisory and Licensing Regime and Fees

Cook Islands

Cook Islands: Legal Framework and Formation Rules and Fees
Cook Islands: Supervisory and Licensing Regime and Fees

Cyprus

Cyprus: Legal Framework and Formation Rules and Fees
Cyprus: Supervision, Licensing and Tax

Gibraltar

Gibraltar: Legal Framework and Formation Rules and Fees
Gibraltar: Legislation, Regulation and Supervision

Guernsey

Guernsey: Legal Framework and Formation Rules and Fees
Guernsey: Trusts Law 2007

Isle of Man

Isle of Man: Legal Framework and Formation Rules and Fees
Isle of Man: Supervisory and Licensing Regime
Isle of Man: Uses Clients and Tax Treatment

Jersey

Jersey: Legal Framework and Formation Rules and Fees
Jersey: Supervisory and Licensing Regime
Jersey: Trusts Amendment Act 2006
Jersey: Foundations

Liechtenstein

Liechtenstein: Legal Framework and Formation Rules and Fees
Liechtenstein: Regulation Supervision and Transparency
Liechtenstein: Characteristics of Liechtenstein Trusts
Liechtenstein: Foundations

Madeira

Madeira: Legal Framework and Formation Rules and Fees

Malta

Malta: Legal Framework and Formation Rules and Fees
Malta: The Trust and Trustees Act 2004

Mauritius

Mauritius: Legal Framework and Formation Rules and Fees
Mauritius: Characteristics of the 2001 Trusts Act
Mauritius: Additional Provisions of the 2001 Trusts Act
Mauritius: Tax Treatment

Monaco

Monaco: Legal Framework and Formation Rules and Fees

Nevis

Nevis: Legal Framework and Formation Rules and Fees

New Zealand

New Zealand: Legal Framework and Formation Rules and Fees
New Zealand: Review of the Law of Trusts
New Zealand: Taxation of Trusts

Panama

Panama: Legal Framework and Formation Rules and Fees
Panama: Requirements for Acting as Trust Company in Panama

Seychelles

Seychelles: Legal Framework and Formation Rules and Fees

Turks & Caicos

Turks & Caicos: Legal Framework and Formation Rules and Fees
Turks & Caicos: The Voidable Dispositions Ordinance

Vanuatu

Vanuatu Legal Framework and Formation Rules and Fees

 


Jersey News

Channel Islands Exchange Attracting New Listings Thursday 3/11/2016 Steps taken by the Channel Islands Stock Exchange to enhance and diversify its offerings contributed to a 13 percent increase in new business during the first half of the year.

JFSC Reports On Trust Company Business Compliance Wednesday 30/3/2016 The Jersey Financial Services Commission has published an annual review of its findings during on-site visits in 2015 to review the practices of trust company businesses.

Jersey Raises Trust Company Fees Tuesday 23/2/2016 The Jersey Financial Services Commission has raised Trust Company Business registration and application fees for 2016.

Jersey Regulator Issues 2016 Business Plan Friday 12/2/2016 The Jersey Financial Services Commission has set out its objectives and priorities for the coming year in its 2016 Business Plan and Budget.

Channel Islands Exchange Welcomes Solid 2015 Thursday 28/1/2016 There was an eight percent increase in the number of securities listed on the Channel Islands Securities Exchange in 2015.

Jersey Regulator To Hike Trust Registration Fees Tuesday 22/12/2015 The Jersey Financial Services Commission has launched a public consultation on proposals to increase annual registration fees and alter the current fee cap for trust companies.

Dispute Over Viability Of Jersey's IFC Project Tuesday 3/11/2015 Jersey's Corporate Services Scrutiny Panel has said Jersey's new international finance center complex is not financially viable, in comments regarding a first building – Building 4 – that is being constructed and the wider plans.

Gibraltar To Introduce Foundations Wednesday 28/10/2015 The Government of Gibraltar has launched a consultation on the introduction of new legislation to permit the creation of private foundations.

Appleby Named Top Offshore Law Firm Of 2015 Thursday 8/10/2015 International law firm Appleby has been named Legal 500 UK's 2015 "Firm of the Year" in the Offshore category.

Jersey Finance Sector Supporting Economic Recovery Wednesday 30/9/2015 Jersey's Statistics Unit has reported that 2014 was the first year since 2007 that Jersey's economy grew in real terms.